Despite yesterday's strong demand and fall in Norway Langeled flows, the UK systems remained comfortable due to higher LNG flows and storage withdrawals. Given the milder weather forecast for next week, it seems as though the higher storage withdrawals are no longer a concern for the market. No dramatic change is expected today - but we may see prices bouncing back on the back of higher gas nearby and higher oil prices
How did the markets close?
Day-Ahead prices continued to drop yesterday, closing at 67.70ppt (gas). On top of this, milder forecasted weather for the coming week led to a retreat in prompt contracts. Other areas of the curve saw small increases - with Feb13 jumping 0.20ppt from its opening price and the Front Season moving up 0.25ppt. The Day-Ahead price for power rose £0.15/MWh whilst Feb and March13 on the front curve didn't move from their opening prices. Other areas of the curve saw small gains - but these were held back by bearish coal and carbon.
How did the markets open?
Gas flows looked quite healthy this morning - as Langeled returned to its normal flow of 70mcm. Flows from LNG also improved from yesterday's level - now operating at approximately 40mcm. Despite this, Day Ahead saw a rise of 0.20ppt. Gains were also seen all over the curve. In terms of power, despite a drop in API2 Coal, prices failed to move accordingly - with the main curve seeing gains. Day-Ahead increased £1.00/MWh as cold weather continues to take hold in some countries.
1-year forward prices
Based on last night's market close data, there was a slight fall in 1-year forward prices for commercial gas and commercial electricity. This is represented in the graph below.
Latest Brent Crude Oil price
Prices of Brent Crude were almost unchanged yesterday due to the closure of US markets. However, gasoil prices did see a rise on the back of the cold weather seen in Europe. Brent prices could today receive support from the ZEW survey and from US economic data. We could see prices rebound to 113.29 at best. Note: Brent Crude prices are taken from opening market data, and do not represent the price as it changes throughout the day.